Equal monthly installments (EMIs) have expanded to scope and shape for those who want to buy a full range ranging from homes and cars to refrigerators and mobile phones. You can start enjoying the product completely without paying yourself completely by paying small payments every month, quarterly or semi-annually.
With the increase in medical inflation, health insurance companies have increased a huge increase of 30%in some cases in recent months. As a result, health insurance EMIs are being introduced as a solution to manage high premium payments.
But unlike traditional EMI, health insurance products purchased at installments have a significant disadvantage that is rarely discussed. While claiming under an EMI option in health insurance, all later installments will be payable immediately. Say it simply, then you have to pay the entire insurance premium when you are filing the claim.
“In the event of a claim, all later premium installments will be payable and payable immediately,” major health insurers said in their terms and conditions for policies purchased through installments. “The company has the right to fix and cut all pending installments from the claim amount under the policy,” the insurers said.
There are several examples of insurers who dismiss the claims overall for the policies purchased under EMIS, stating that the installments to be done are higher than the estimated and approved claim amount. The failure to pay the remaining installments resulted in a lump sum rejection of your claim. There are some other things here that you should know before purchasing a health insurance policy under EMI.
Aquaar
Health insurers provide fifteen days of ex -gratia period when the premium payment mode is monthly. In all other cases, they offer thirty days grace period to pay installment premium due to the policy. “During such grace period, coverage will be available, if the premium is paid in installments during the policy period,” the insurers said.
The insured person will get the continuity benefits earned in relation to the ‘waiting period’ and ‘specific waiting period’ if the premium is paid within the prescribed grace period. If the installment is not obtained within the ex -gratia period due to premium, the policy will be canceled.
Discount on claim free period
Health insurers provide discounts that can vary from 10% -30% if no claims are made during the policy period. But many insurers do not offer this benefit if you buy your health insurance policy under EMI. Care Health Insurance said in its terms for the ‘ultimat care’ policy, “If the insured person has opted for premium payment in installments, the tenure exemption will not apply.”
Credit check
Since you are buying a policy through EMI, the insurer will check credit to assess your credibility. If your credit score is below the desirable level, you will be difficult to get EMI on your health insurance. Acko Health Insurance said in its interpreter at Health Insurance EMIS, “Some health insurance companies may require credit checks before approving the EMI payment scheme. If you have a low credit score or history history, then you may have difficulty in approved for EMI payment scheme,” Acquen Insurance by AMI Health Insurance Said.
Switch possible only during renewal
Health insurance products purchased on EMI will remain in ‘installment mode’ till the completion of the policy period. You can switch your health insurance policy from EMI during only one regular renewal. This will only add an additional layer of complexity to manage your finance as you have to track payment and ensure that enough money is available to your account to pay EMI.
Although EMI appears attractive on paper in health insurance, it will only give rise to high costs and is quite risky from the perspective of coverage. This can only be a stop-gap system and should not be a standard mode to pay health insurance.
Allerjan M is a journalist with two decades of experience. He has worked with several major media organizations in the country and has been writing on mutual funds for almost 16 years.
